To my mind you don’t help prevent prejudice by removing references to a religion and cultures from the wider popular culture. You do it by educating people and exposing them to those cultures.
If the only phylacteries in the game were used by evil Liches then there might be a moral or social argument for renaming them. As has been said there are also phylacteries that heal wounds and help someone stay faithful. If the use in a game encourages a person to google phylactery and find out what they are in real life, all to the good I say.
I personally dislike naming conventions that mash two words together. Games Workshop was terrible for that. There are about a thousand miniatures, abilities, items or organizations that use the word blood, skull or soul paired with another word. I’d much prefer something original even if it involves creating a new word.